Tobacco Control Legislation and Resource Allocation Effects

In December 1995 Health Canada published Tobacco Control: A Blueprint to Protect the Health of Canadians which outlines the Government of Canada's new strategy to reduce tobacco consumption. Bill C-71, The Tobacco Act, was subsequently introduced, and received royal assent in April, 1997. The objective of this paper is to use input-output analysis to examine the resource allocation effects of a reduction in tobacco consumption that would likely result from this legislation. We find that significant reallocation effects may occur, and the employment effects may be more severe in the public than in the private sector.